The pure expectations theory, or the expectations hypothesis, asserts that long-term interest rates can be used to estimate future short-term interest rates. Based on the pure expectations theory, is the following statement true or false? the pure expectations theory assumes that investors do not consider long-term bonds to be riskier than short-term bonds. True False the yield on a one-year Treasury security is 5.6100%, and the two-year Treasury security has a 6.7300% yield. Assuming that the pure expectations theory is correct, what is the market's estimate of the one-year Treasury rate one year from now? 8.9604% 9.9822% 7.8600% 6.6810% Recall that on a one-year Treasury security the yield is 5.6100% and 6.7300% on a two-year Treasury security. Suppose the one-year security does not have a maturity risk premium, but the two-year security does and it is 0.4000%. What is the market's estimate of the one-year Treasury rate one year from now? 8.9540% 8.0370% 5.9930% 7.0500% Suppose the yield on a two-year Treasury security is 5.83%, and the yield on a five-year Treasury security is 6.20%. Assuming that the pure expectations theory is correct, what is the market's estimate of the three-year Treasury rate two years from now? 7.10% 6.69% 5.46% 6.45%